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Preparing and filing accounts of and conducting an audit for a United Kingdom company. Service offer

The current corporate and tax legislation requires a UK company to annually file its tax return and accounts (financial statements) with the UK authorities; such accounts must often be audited. We are happy to assist with preparing and auditing the accounts of a UK company, including the liaising with the relevant UK authorities – Companies House (CH) and Her Majesty’s Revenue and Customs (HM Revenue and Customs / HMRC).

We also offer a full range of consulting services that may be required when conducting business using a foreign company: whether in relation to the CFC[1] rules, accounting and taxation, calculation and payment of specific taxes and levies, or regarding legal and tax analysis of contracts, companies’ corporate structure and other matters.

Budget for preparing and filing accounts of and conducting an audit for a UK company[2]

Fees (USD)
Preparing and filing dormant accounts
(accounts for dormant companies) – unaudited
Preparing and filing non-dormant accounts (accounts for trading companies) and conducting an audit
100 – 400 / hour
(based on time spent)
Advising on legal, tax and accounting matters
from 200 / hour

Auditing the accounts of a UK company

All UK companies are required to annually prepare and file audited accounts (financial statements) reflecting the financial position of the company and the results of its financial activities for the year (“companies” here meaning all entities, including partnerships).

Accounts must normally include:

  • a profit and loss account;
  • a balance sheet signed by a director on behalf of the board;
  • notes to the accounts;
  • group accounts (if applicable).

Accounts must also be accompanied by:

  • a director’s report signed by the secretary or director and containing an analysis of activities (or a strategy report), unless the UK company qualifies as small;
  • an auditor’s report stating the name of the auditor, signed and dated by the auditor (unless the UK company is exempted from audit).

If a UK company is not eligible for exemption from audit, then its accounts must be audited by an auditor and a corresponding report must be attached to the accounts.

Before the first general meeting of members, the directors themselves may appoint an auditor. Thereafter, auditors are usually appointed by a members’ meeting. The auditor must be a member of a recognized supervisory body and be authorized by that body to act as auditor.

To qualify for audit exemption, a UK company must belong to either of the below categories:
1 – dormant companies;
2 – small companies.

Dormant companies

According to section 480 of the Companies Act, companies that qualify as dormant are eligible to file unaudited accounts with Companies House.

A company is considered dormant if there has been no “significant accounting transactions” during the financial year.

For the purposes of company qualifying as dormant, significant transactions do not include the following (i.e. these transactions do not deprive the company of a dormant status):

  1. payment of share capital (money paid for shares when the company was incorporated);
  2. filing fees paid to Companies House (for example, when filing an Annual Return);
  3. penalties for late filing of accounts with Companies House.

Small companies

According to section 477 of the Companies Act, companies that qualify as small are eligible to file unaudited accounts with Companies House.

Conditions for a company to qualify as small – two or more must be met simultaneously:

  1. annual turnover of not more than GBP 10 200 000;
  2. balance sheet total of not more than GBP 5 100 000;
  3. average number of employees of not more than 50.

Public companies and companies in some regulated industries cannot qualify as small (section 478 of the Companies Act).

It is important to note that according to section 476 of the Companies Act, members have the right to request an audit. If such a request is made, a company is required to produce audited accounts, whether or not it meets the dormant/small company criteria set in sections 477 and 480.

The liability for classifying a company as small or dormant lies with the director. If the director thinks that the company meets the above-mentioned requirements of sections 477 or 480 of the Companies Act and therefore may be exempted from audit, he includes in the accounts a relevant statement with reference to the section of the Act. The director must also state that the members did not exercise their right provided by section 476 and did not request an audit.

The fees for preparing accounts and returns and conducting an audit of the company’s activities are charged on a time-spent basis at hourly rates ranging from USD 100 to 400, depending on the type of work and the qualification of a specialist involved.

In the course of our work, we have tried to create a technological process that, on the one hand, would require your minimum involvement and, on the other hand, would allow us to optimize the administrative costs of company maintenance. We try to apply a flexible approach to pricing, taking into account the individual requirements of clients and all sorts of specific factors.

Thus, in our practice we have cases where the hourly calculation may be inconvenient and so it is possible to agree in advance the fees for preparing accounts and auditing the company’s activities (or for work on a particular segment or stage – for large projects). Such fee estimate can be made based on the analysis of underlying documents (bank statements, copies of contracts and invoices, information about the company’s assets and liabilities, etc.) provided in advance. This method allows you to work out the costs beforehand and simplifies your management decisions related to cost planning.

Indicative fees for our services depending on the number of transactions and other factors

Trading company

Number of transactions
USD 770 – 1 000
USD 1 200 – 1 600
USD 1 650 – 2 000
USD 2 100 – 2 500
over 200
from USD 2 500

Holding company (holds a controlling interest in other legal entities)

Number of subsidiaries and associated companies
up to 5 subsidiaries and associated companies
USD 1 500
over 5 subsidiaries and associated companies
from USD 2 000

Investment company

Number of securities and financial derivatives
up to 10 securities
USD 1 700 – 2 000
over 10 securities
from USD 2 500

Company holding immovable property and other assets

The fees for preparing accounts for such a company start at USD 1 500 and will depend on the location, use, type and book (estimated) value of the assets.

Indicative fees depending on the company’s jurisdiction

Company’s jurisdiction
Fees for preparing dormant accounts
Up to 50 transactions
United Kingdom
USD 770
USD 2 100
The above tables show indicative fees based on which it is possible to draw up a budget. The final fees must be checked with the auditor (after providing all available underlying documents).

[1] CFC (controlled foreign company) is a foreign organization that simultaneously meets two conditions:

1) the organization is not a tax resident of the Russian Federation and
2) the organization is controlled by an entity and (or) an individual that is a tax resident of the Russian Federation.
Controlled foreign companies also include foreign structures without legal personality which are controlled by an organization and (or) an individual that is a tax resident of the Russian Federation.

[2] The fees are valid at the date of sending of this offer.

[3] These fees do not include the preparation of consolidated financial statements.

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770 USD
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